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Base sees rare earths potential at Toliara

Base Resources boss Tim Carstens says adding a monazite production stream to the company’s $US520 million Toliara mineral sands project in Madagascar could be transformational.

Unveiling the company’s full-year results on Monday, Mr Carstens said a concept study on separating and potential downstream processing of the rare earth was anticipated by the end of the year.

“The sort of volumes we’re talking about can be transformational for the project so watch this space,” he said.

Toliara is considered one of the best and longest life mineral sands projects in the world, but progress on developing it has been slow.

When Base struck a $US75m deal to acquire an initial 85 per cent stake in Toliara in late 2017, it had hoped the project could be brought into production by the middle of 2021.

But following the completion of an enhanced definitive feasibility study for the project in September last year, the company is targeting a final investment decision in September next year with first shipments anticipated by the end of 2025.

Mr Carstens said an agreement with the island nation’s government on fiscal terms for the project was now “agonisingly close”.

The project is expected to deliver annual EBITDA of $US219m over a 38-year mine life.

Toliara would represent the Perth-based company’s second mine in Africa after the company’s foundational mineral sands mine, Kwale, in Kenya.

Base unveiled record $US80.7m full-year profit on Monday on the back of a 41 per cent jump in revenue to $US279.1m after benefiting from higher mineral sands prices and consistent production from Kwale.

The company declared a final unfranked dividend of 3¢ a share, bringing its full-year payout to 6¢.

In June, Base approved the development of its Bumamani project, which would extend the life of Kwale to December 2024. Additional mine life extensions are being explored.

The company issued financial year 2023 guidance of 62,000-73,000t of rutile, 260,000-310,000t of ilmenite and 22,000-27,000t of zircon.

Base shares closed up 1¢ at 33¢ on Monday.

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